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Healthtech could make headway in fixing broken healthcare

11 January 2018
– 4 Minute Read

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While some parts of South African healthcare are a regulatory minefield for players in the health technology (healthtech) industry, others are virtually unrestricted. The latter presents compelling opportunities for technological innovation aimed at improving the cost-effectiveness, efficiency and responsiveness of healthcare.

On the one extreme, subject to stringent regulation, are healthcare services that are diagnostic or clinical in nature. On the other, are the many aspects of delivering or managing a healthcare service that do not involve diagnosis, treatment, the transmission of personal information and so on. These are almost free from ethical and regulatory restrictions, and could benefit significantly from innovative technology.

Regulation tightens on medical devices

Medical devices and in vitro diagnostics (IVDs) are examples of a section of the healthcare space that is now more strictly regulated than before as a result of recent changes to the Medicines and Related Substances Act, and the regulations associated with it.

The amended law clamps down strongly on the advertising, marketing, incentivising and free supply of medical devices and IVDs. It reinforces the licencing requirement for medical device and IVD manufacturers, wholesalers and distributors, and imposes a registration requirement for medical devices and IVDs that are called up for registration.

A whole host of items widely in use in South Africa could now be considered medical devices for regulatory purposes.

Blood-glucose monitors that people with diabetes wear to remind them to take their medication may well be considered medical devices for purposes of the amended law. Equally, so might apps that send an emergency signal in the event of a stroke or other health crisis.

Ultimately, the analysis of whether or not an item is a medical device or IVD will depend on the intention of the manufacturer of the medical device/IVD, as well as the functions the device actually performs and what happens to the information it generates.

If an item is considered to be a medical device or IVD for purposes of the amended law, then the licensing and registration requirements will come into play, as will the restrictions set out above in relation to advertising, marketing, incentivising and the supply of medical devices and IVDs.

The medical device industry may still have a little breathing space to get their ducks in a row, however. While the amended Medicines Act and regulations are already in force, and even though there are no transitional provisions for the delayed application of the amended law, it does not seem they are being applied just yet. Still, everyone involved in the value chain, from manufacturers to healthcare professionals, will have to tread extremely carefully, especially in the unchartered regulatory territory of healthtech.

Managed healthcare is ripe with opportunity

In contrast, there is minimal regulatory restriction and significant opportunity for technological innovations that make the business of managing a private sector or public-sector healthcare operation more efficient, cost-effective and user-friendly. As long as there is no diagnostic or clinical function (which brings ethical and regulatory restrictions into the picture), taking advantage of these opportunities should be relatively straightforward.

Indeed, many government policy documents expressly identify areas such as pharmaceutical inventory and stock management where clever, responsive technology can indirectly improve health outcomes. Policies that are supportive of technology include the Green Paper on m-health, the National Health Insurance (NHI) White Paper of 2017, the NHI Pilot Project reports and the National Development Plan.

A good place for South Africans to start using healthtech optimally with the fewest regulatory complications would be to look at areas of the healthcare sector that are inefficient, expensive, slow or broken in any way. There is certainly no shortage of such areas.

Following the lead of financial services

The next step would be to bring together financiers, designers, lawyers, health practitioners, specialists and others to generate the beginning of a solution that can then be collaboratively explored and developed – like stakeholders in the financial services sector are doing with the South African Financial Blockchain Consortium.

The South African healthcare sector is labouring under the burden of disease and inefficiency in equal measure. Technology has a key role to play in cutting costs and improving quality of healthcare for all citizens of South Africa. The sooner we all put our heads together to harness healthtech wisely, the sooner we can make headway in fixing a broken healthcare system.